Despite the loss of 2,000 jobs in April, the unemployment rate in the construction industry throughout the United States dropped by almost three per cent, the latest data has found.
According the latest employment report from the United States Department of Labour, the number of people employed in the United States construction industry fell by 2,000 in the month of April.
The worst-hit sector was non-residential specialty trade contracting, which shed 8,400 jobs during the month. Workers in residential building construction and non-residential building construction were also hit; 2,500 jobs were lost in residential construction while 1,100 jobs were lost in non-residential construction.
On the bright side, however, residential specialty trade contractor employment was up by 6,300 jobs while the number of jobs in civil and heavy industry construction was up by 3,300.
Furthermore, in a sign that the decline in construction employment following the GFC has finally eased, employment numbers are up compared with this time last year – albeit only by a modest 1.1 per cent, or 63,000 jobs. Unemployment levels remain low compared with recent historic levels.
Moreover, despite the overall loss in employment, the industry’s unemployment rate fell from an estimate of 17.2 per cent in March to 14.5 per cent in April, meaning the proportion of construction workers throughout the country who are currently without work has fallen.
Momentum Not Carrying Forward
Still, Associated Builders and Contractors (ABC) Chief Economist Anirban Basu warns that continued weakness in non-residential construction employment indicates that momentum in this sector toward the latter part of 2011 has not carried forward into 2012. Basu says the weak numbers for contractors in non-residential is an indication that new work is not coming into the system as fast as existing projects are being completed.
However, despite warnings that commercial and industrial sector may remain soft in coming months, Basu believes an improving economic outlook, along with stable commodity and construction input prices, will see a lift in activity over the longer term.
“The nation’s economy has managed to regain some semblance of momentum since last September, which should ultimately translate into better news for the construction industry,” Basu says. “For the second consecutive year, the nation’s economy has softened during the January-April period. However, US economic fundamentals are better now than they were a year ago as there is no immediate debt ceiling confrontation ahead.”
He adds that an improvement in commodity and construction input prices over last year “indicates that the broader US economy, and eventually the construction industry, are positioned to expand.”
